Xapo Enters U.K. With Dual Bitcoin and Fiat Interest Accounts

Xapo Bank, one of the first digital asset custodians and Bitcoin-native bank, has entered the U.K. market after receiving its banking license.

The bank brings two new products for its clients: Bitcoin and fiat interest-bearing accounts.

Xapo customers can send up to $1 million British pounds or $1.28 million, and make payments to U.K.-based wallets and bank accounts. The Bitcoin account yields 1% without staking, lending, or locking up assets, said the company.

“We're proud to announce we have successfully passported our banking license into the UK,” said Seamus Rocca, CEO of Xapo Bank. “This means we are allowed to offer our banking services directly to the UK market. Achieving this is no easy feat and shows we meet the UK’s high regulatory standards.

In an announcement, the company also said that Bitcoin accounts are able to spend their funds “like fiat” with a universally accepted debit card, along with allowing investors exposure to S&P 500 stocks and other cryptocurrencies.

Fort Knox-Style Security

Based out of Gibraltar, Xapo began offering its clients Bitcoin in 2013, when Bitcoin-native banks were scarce and unreliable. It is known for its Fort Knox-style security, with underground bunkers deep in the Swiss Alps, and heavy measures for securing their clients private keys.

It has been pioneering moves in and out of crypto, becoming in May the first fully licensed bank to support Bitcoin deposits via the protocol’s Layer 2 Lightning Network.

The U.K. has been determined in establishing a regulatory sandbox for the nascent crypto industry. Dubbed the Digital Securities Sandbox (DSS), the Bank of England and Financial Conduct Authority (FCA) are spearheading the effort with several consultation papers.

In late May, SEC commissioner Hester Peirce suggested a cross-border regulatory framework for U.S. and U.K. crypto industries. No advancements have been made.